HSBC has introduced its lowest ever mortgage rate, at 2.99 per cent, but it is available only to its wealthiest customers.

The bank has pledged to double its 2007 level of mortgage lending this year, making £15 billion available.

The new two-year discount mortgage, at 0.95 per cent below HSBC’s standard variable rate (SVR), will be at 2.99 per cent from February 6, when its SVR will fall to 3.94 per cent.

However, the deal will be available only to HSBC Premier customers – those with £50,000 in savings and investments held with HSBC or those who already have a £250,000 mortgage with the bank and a salary of £75,000.

You will also need a deposit of 40 per cent of the value of the property and will have to pay a mortgage arrangement fee of £999.

Melanie Bien, of Savills Private Finance, the mortgage broker, said: "This is a very attractive low rate of interest, but there are two main problems with this particular mortgage. The first is that borrowers must open a Premier current account to qualify - and most people don't want the hassle of moving their current account with all its direct debits and standing orders.

“The second problem is that, because it is a discounted variable rate, it is connected to the lender's standard variable rate, which is set at the lender's discretion. In this instance, it is low, but that is not true of every lender. In most instances, borrowers tend to be better off with trackers (with no collars) that have to follow movements in the base rate so tend to be far more transparent.”

HSBC has also re-entered the tracker market, with rates starting at 4.09 per cent for borrowers who have a 25 per cent deposit and are willing to pay a £599 fee.

It has also introduced a two year fixed-rate mortgage at 3.99 per cent for customers with a 40 per cent deposit. Abbey and the Principality Building Society have also introduced two-year fixed-rate deals at 3.99 per cent, again only up to 60 per cent loan to value (LTV).

However, there was little help from HSBC for first-time buyers struggling to save a deposit. The bank's two-year fixed rate for those with a 10 per cent deposit is still at a much higher rate of 6.79 per cent.

David Hollingworth, of London & Country, another mortgage broker, said: “Interest rates across the market continue to be much higher for those with a 10 per cent deposit. Only those with a sizeable deposit or a large amount of equity in their home will have access to the best deals.”

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